Sweetgreen, Inc. (NYSE: SG) (the “Company”), the mission-driven,
next generation restaurant and lifestyle brand that serves healthy
food at scale, today announced financial results for its third
fiscal quarter ended September 29, 2024.
Third quarter 2024 financial
highlights
For the third quarter of fiscal year 2024, compared to the third
quarter of fiscal year 2023:
- Total revenue was $173.4 million, versus $153.4 million in the
prior year period, an increase of 13%.
- Same-Store Sales Change of 6%, up from Same-Store Sales Change
of 4% in the prior year period.
- AUV of $2.9 million was consistent with the prior year
period.
- Total Digital Revenue Percentage of 55% and Owned Digital
Revenue Percentage of 29%, versus Total Digital Revenue Percentage
of 58% and Owned Digital Revenue Percentage of 37% in the prior
year period.
- Loss from operations was $(21.2) million and loss from
operations margin was (12)%, versus loss from operations of $(26.5)
million and loss from operations margin of (17)% in the prior year
period.
- Restaurant-Level Profit(1) was $34.9 million and
Restaurant-Level Profit Margin was 20%, versus Restaurant-Level
Profit of $29.1 million and Restaurant-Level Profit Margin of 19%
in the prior year period.
- Net loss was $(20.8) million and net loss margin was (12)%,
versus net loss of $(25.1) million and net loss margin of (16)% in
the prior year period.
- Adjusted EBITDA(1) was $6.8 million, versus Adjusted EBITDA of
$2.5 million in the prior year period; and Adjusted EBITDA Margin
was 4%, versus 2% in the prior year period.
- 5 Net New Restaurant Openings, versus 15 Net New Restaurant
Opening in the prior year period.
(1) Restaurant-Level Profit,
Restaurant-Level Profit Margin, Adjusted EBITDA, and Adjusted
EBITDA Margin are financial measures that are not calculated in
accordance with accounting principles generally accepted in the
United States of America (“GAAP”). Reconciliations of
Restaurant-Level Profit, Restaurant-Level Profit Margin, Adjusted
EBITDA, and Adjusted EBITDA Margin to the most directly comparable
financial measures presented in accordance with GAAP, are set forth
in the schedules accompanying this release. See “Reconciliation of
GAAP to Non-GAAP Measures.”
“Our strong third-quarter performance demonstrates that our
focus on menu innovation showcasing seasonal ingredients and
driving operational execution is working. Top line revenue grew 13%
with positive traffic and mix contributing to same store sales
growth of 6% - a testament to the dedication of our teams, the
continued loyalty of our guests, and the strength of our brand as
we continue to redefine fast food,” said Jonathan Neman, Co-Founder
and Chief Executive Officer. “Our expanded menu together with the
performance of our 2024 class of new restaurant openings, growth in
emerging markets and our successful deployment of the Infinite
Kitchen gives us confidence in the reacceleration of our 2025 unit
growth.”
“In the third quarter, we reported a 20.2% restaurant-level
margin, a more than 100 basis point improvement from the third
quarter of 2023 and marking our 7th consecutive quarter of
year-over-year restaurant-level margin expansion. Adjusted EBITDA
for the quarter was $6.8 million, up from $2.5 million from the
third quarter of 2023. Our year-to-date Adjusted EBITDA of $19.3
million versus a $1 million loss this time last year continues to
demonstrate our focus on profitability,” said Mitch Reback, Chief
Financial Officer. “We are encouraged by our performance nine
months into the year on both the top and bottom line, which is why
we are raising our fiscal year 2024 guidance.”
Results for the third quarter ended
September 29, 2024:
Total revenue in the third quarter of fiscal year 2024 was
$173.4 million, an increase of 13% versus the prior year period.
This increase was primarily due to an increase of $12.4 million of
incremental revenue associated with 31 Net New Restaurant Openings
during or subsequent to the third quarter of fiscal year 2023. In
addition, $8.5 million of the increase was the result of Same-Store
Sales Change of 6%, consisting of a 4% benefit from menu price
increases that were implemented subsequent to the thirteen weeks
ended September 24, 2023 and a 2% increase due to traffic and
favorable product mix. These increases were partially offset by a
$0.4 million decrease in fiscal year-over-year comparable
restaurant sales, which would have been reflected in our Same-Store
Sales Change had we not adjusted for the misalignment in our
comparable weeks resulting from fiscal year 2023 being a 53-week
year, as described below.
Our loss from operations margin was (12)% for the third quarter
of fiscal year 2024 versus (17)% in the prior year period.
Restaurant-Level Profit Margin was 20%, an increase of more than
100 basis points versus the prior year period, due to same-store
sales growth of 6%, labor optimization, and reduced occupancy rates
across recently opened stores, partially offset by higher protein
costs and higher staffing expenses associated with increases in
prevailing wage rates in many of our markets.
General and administrative expense was $36.8 million, or 21% of
revenue for the third quarter of fiscal year 2024, as compared to
$36.0 million, or 23% of revenue in the prior year period. The
increase in general and administrative expense was primarily due to
an increase in spend across the Sweetgreen Support Center to
support our restaurant growth, partially offset by a $1.8 million
decrease in stock-based compensation expense, primarily related to
the decrease in expenses associated with restricted stock units and
performance-based restricted stock units issued prior to our
IPO.
Net loss for the third quarter of fiscal year 2024 was $(20.8)
million, as compared to $(25.1) million in the prior year period.
The decrease in net loss was primarily due to a $5.8 million
increase in our Restaurant-Level Profit, partially offset by an
increase in depreciation and amortization expense primarily
associated with an increase in restaurants, as well as an increase
in general and administrative expense as described above.
Adjusted EBITDA, which excludes stock-based compensation expense
and certain other adjustments, was $6.8 million for the third
quarter of fiscal year 2024, as compared to $2.5 million in the
prior year period. This improvement was primarily due to an
increase in Restaurant-Level Profit, as well as a decrease in
pre-opening expenses partially offset by an increase in general and
administrative expense, as described above.
Fiscal Year 2024 Outlook
For fiscal year 2024, we are updating our financial guidance to
reflect the strength of our first three quarters.
- 24-26 Net New Restaurant Openings
- Revenue ranging from $675 million to $680 million
- Same-Store Sales Change between 6-7%
- Restaurant-Level Profit Margin of 19.5%-20%
- Adjusted EBITDA between $18 million to $20 million
We have not reconciled our expectations as to Restaurant-Level
Profit Margin and Adjusted EBITDA to their most directly comparable
GAAP measures as a result of uncertainty regarding, and the
potential variability of, reconciling items. Accordingly,
reconciliation is not available without unreasonable effort,
although it is important to note that these factors could be
material to our results computed in accordance with GAAP.
Conference Call
Sweetgreen will host a conference call to discuss its financial
results and financial outlook today, November 7, 2024, at 2:00 p.m.
Pacific Time. A live webcast of the call can be accessed from
Sweetgreen’s Investor Relations website at investor.sweetgreen.com.
An archived version of the webcast will be available from the same
website after the call.
Forward-Looking
Statements
This press release and the related conference call, webcast, and
presentation contain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. These
statements may include, but are not limited to, statements
regarding our financial outlook for the full fiscal year 2024,
including our expectations around comparable restaurant sales
growth, net new restaurant openings (including those featuring
Infinite Kitchen), revenue, Same-Store Sales Change,
Restaurant-Level Profit Margin, and Adjusted EBITDA. They also
include statements regarding our ability to leverage technology to
drive efficiencies in our financial and operating model, drive
traffic and check growth, our digital growth initiatives, our
ability to elevate our brand and sourcing standards, our unit
expansion strategy, and our continued growth in both existing and
emerging markets. Additionally, they cover our belief in the
significant whitespace available for our brand, our plans for
Infinite Kitchens deployment and expected benefits and our focus on
further menu innovation. Forward-looking statements are inherently
subject to risks and uncertainties, some of which cannot be
predicted or quantified. In some cases, you can identify
forward-looking statements because they contain words or phrases
such as “anticipate,” “are confident that,” “believe,”
“contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “opportunity,” “plan,” “potential,” “predict,” “project,”
“should,” “target,” “toward,” “will,” or “would,” or the negative
of these words or other similar terms or expressions. You should
not put undue reliance on any forward-looking statements.
Forward-looking statements should not be read as a guarantee of
future performance or results and will not necessarily be accurate
indications of the times at, or by, which such performance or
results will be achieved, if at all.
Forward-looking statements are based on information available at
the time those statements are made and are based on current
expectations, estimates, forecasts, and projections as well as the
beliefs and assumptions of management as of that time with respect
to future events. These statements are subject to risks and
uncertainties, many of which involve factors or circumstances that
are beyond our control, that could cause actual performance or
results to differ materially from those expressed in or suggested
by the forward-looking statements. In light of these risks and
uncertainties, the forward-looking events and circumstances
discussed in this press release and the related conference call may
not occur and actual results could differ materially from those
anticipated or implied in the forward-looking statements. These
risks and uncertainties include our ability to compete effectively,
uncertainties regarding changes in economic conditions and
geopolitical events, and the customer behavior trends they drive,
our ability to open new restaurants, our ability to effectively
identify and secure appropriate sites for new restaurants, our
ability to expand into new markets and the risks such expansion
presents, the impact of severe weather conditions or natural
disasters on our restaurant sales and results of operations, the
profitability of new restaurants we may open, and the impact of any
such openings on sales at our existing restaurants, our ability to
build, deploy, and maintain our proprietary kitchen automation
technology, known as the Infinite Kitchen, in a timely and
cost-effective manner, our ability to preserve the value of our
brand, food safety and foodborne illness concerns, the effect on
our business of increases in labor costs, labor shortages, and
difficulties in hiring, training, rewarding and retaining a
qualified workforce, the impact of pandemics or disease outbreaks,
our ability to achieve profitability in the future, our ability to
identify, complete, and integrate acquisitions, the effect on our
business of governmental regulation and changes in employment laws,
the effect on our business of expenses and potential management
distraction associated with litigation, potential privacy and
cybersecurity incidents, the effect on our business of restrictions
and costs imposed by privacy, data protection, and data security
laws, regulations, and industry standards, and our ability to
enforce our rights in our intellectual property. Additional
information regarding these and other risks and uncertainties that
could cause actual results to differ materially from the Company's
expectations is included in our SEC reports, including our Annual
Report on Form 10-K for the fiscal year ended December 31, 2023 and
subsequently filed quarterly reports on Form 10-Q. Except as
required by law, we do not undertake any obligation to publicly
update or revise any forward-looking statement, whether as a result
of new information, future developments, or otherwise.
Additional information regarding these and other factors that
could affect the Company’s results is included in the Company’s SEC
filings, which may be obtained by visiting the SEC's website at
www.sec.gov. Information contained on, or that is referenced or can
be accessed through, our website does not constitute part of this
document and inclusions of any website addresses herein are
inactive textual references only.
Glossary
- Average Unit Volume (“AUV”) - AUV is defined as the
average trailing revenue for the prior four fiscal quarters for all
restaurants in the Comparable Restaurant Base. The measure of AUV
allows us to assess changes in guest traffic and per transaction
patterns at our restaurants. Fiscal year 2023 was a 53-week year,
and in order to provide a measurement period that is consistent
with comparable periods that span a 52-week year, rather than
simply excluding the extra week, we applied an averaging
methodology to the last period of fiscal year 2023 to adjust for
the extra week.
- Comparable Restaurant Base - Comparable
Restaurant Base for any measurement period is defined as all
restaurants that have operated for at least twelve full months as
of the end of such measurement period, other than any restaurants
that had a material, temporary closure during the relevant
measurement period. A restaurant is considered to have had a
material, temporary closure if it had no operations for a
consecutive period of at least 30 days. One restaurant was excluded
from our Comparable Restaurant Base for the thirteen and
thirty-nine weeks ended September 29, 2024. Two restaurants were
excluded from our Comparable Restaurant Base for the thirteen and
thirty-nine weeks ended September 24, 2023. Such adjustments did
not result in a material change to our key performance
metrics.
- Net New Restaurant Openings - Net New Restaurant
Openings reflect the number of new Sweetgreen restaurant openings
during a given reporting period, net of any permanent Sweetgreen
restaurant closures during the same given period.
- Same-Store Sales Change - Same-Store Sales Change
reflects the percentage change in year-over-year revenue for the
relevant fiscal period for all restaurants that have operated for
at least 13 full fiscal months as of the end of such fiscal period
excluding the 14th week in any 14-week period and the 53rd week in
any 53-week period, as applicable; provided, that for any
restaurant that has had a temporary closure (which historically has
been defined as a closure of at least five days during which the
restaurant would have otherwise been open) during any prior or
current fiscal month, such fiscal month, as well as the
corresponding fiscal month for the prior or current fiscal year, as
applicable, will be excluded when calculating Same-Store Sales
Change for that restaurant. Fiscal year 2023 was a 53-week year,
which resulted in a misalignment in our comparable weeks in fiscal
year 2024. To adjust for this misalignment, in calculating
Same-Store Sales Change for each fiscal quarter and the full fiscal
year 2024, we shifted each week within fiscal year 2023 forward by
one week to better align with the 2024 calendar year, specifically
to match the timing of holidays and achieve a more accurate
comparable Same-Store Sales Change to the prior period. During the
thirteen and thirty-nine weeks ended September 29, 2024, two and
five restaurants were excluded from the calculation of Same-Store
Sales Change, respectively. During the thirteen and thirty-nine
weeks ended September 24, 2023, zero and two restaurants were
excluded from the calculation of Same-Store Sales Change,
respectively. Such adjustments did not result in a material change
to Same-Store Sales Change. This measure highlights the performance
of existing restaurants, while excluding the impact of new
restaurant openings and closures.
- Total Digital Revenue Percentage and Owned Digital Revenue
Percentage - Our Total Digital Revenue Percentage is the
percentage of our revenue attributed to purchases made through our
Total Digital Channels. Our Owned Digital Revenue Percentage is the
percentage of our revenue attributed to purchases made through our
Owned Digital Channels.
Non-GAAP Financial
Measures
In addition to our consolidated financial statements, which are
presented in accordance with GAAP, we present certain non-GAAP
financial measures, including Restaurant-Level Profit,
Restaurant-Level Profit Margin, Adjusted EBITDA, and Adjusted
EBITDA Margin. We believe these measures are useful to investors
and others in evaluating our performance because these
measures:
- facilitate operating performance comparisons from period to
period by isolating the effects of some items that vary from period
to period without any correlation to core operating performance or
that vary widely among similar companies. These potential
differences may be caused by variations in capital structures
(affecting interest expense), tax positions (such as the impact on
periods or companies of changes in effective tax rates or NOL), and
the age and book depreciation of facilities and equipment
(affecting relative depreciation expense);
- are widely used by analysts, investors, and competitors to
measure a company’s operating performance; are used by our
management and board of directors for various purposes, including
as measures of performance, as a basis for strategic planning and
forecasting; and
- are used internally for a number of benchmarks, including to
compare our performance to that of our competitors.
We define Restaurant-Level Profit as loss from operations
adjusted to exclude general and administrative expense,
depreciation and amortization, pre-opening costs, loss on disposal
of property and equipment, and, in certain periods, impairment and
closure costs and restructuring charges. Restaurant-Level Profit
Margin is Restaurant-Level Profit as a percentage of revenue. As it
excludes general and administrative expense, which is primarily
attributable to our corporate headquarters, which we refer to as
our Sweetgreen Support Center, we evaluate Restaurant-Level Profit
and Restaurant-Level Profit Margin as a measure of profitability of
our restaurants.
We define Adjusted EBITDA as net loss adjusted to exclude income
tax expense, interest income, interest expense, depreciation and
amortization, stock-based compensation expense, loss on disposal of
property and equipment, other (income) expense, Spyce acquisition
costs, our enterprise resource planning system (“ERP”)
implementation and related costs, legal settlements, and certain
other expenses during the period that management determines are not
indicative of ongoing operating performance. Adjusted EBITDA Margin
is Adjusted EBITDA as a percentage of revenue.
Restaurant-Level Profit, Restaurant-Level Profit Margin,
Adjusted EBITDA, and Adjusted EBITDA Margin have limitations as
analytical tools, and you should not consider them in isolation or
as substitutes for analysis of our results as reported under GAAP.
In particular, Restaurant-Level Profit and Adjusted EBITDA should
not be viewed as substitutes for, or superior to, loss from
operations or net loss prepared in accordance with GAAP as a
measure of profitability. Some of these limitations are:
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized may have to be replaced
in the future, and Restaurant-Level Profit and Adjusted EBITDA do
not reflect all cash capital expenditure requirements for such
replacements or for new capital expenditure requirements;
- Restaurant-Level Profit and Adjusted EBITDA do not reflect
changes in, or cash requirements for, our working capital
needs;
- Restaurant-Level Profit and Adjusted EBITDA do not reflect the
impact of the recording or release of valuation allowances or tax
payments that may represent a reduction in cash available to
us;
- Restaurant-Level Profit and Adjusted EBITDA do not consider the
potentially dilutive impact of stock-based compensation;
- Restaurant-Level Profit is not indicative of overall results of
the Company and does not accrue directly to the benefit of
stockholders, as corporate-level expenses are excluded;
- Adjusted EBITDA does not take into account any income or costs
that management determines are not indicative of ongoing operating
performance, such as stock-based compensation; loss on disposal of
property and equipment; other (income) expense; Spyce acquisition
costs; ERP implementation and related costs; legal settlements; and
other expenses as described in more detail in the table reconciling
our net loss to Adjusted EBITDA, below; and
- other companies, including those in our industry, may calculate
Restaurant-Level Profit and Adjusted EBITDA differently, which
reduces their usefulness as comparative measures.
Because of these limitations, you should consider
Restaurant-Level Profit, Restaurant-Level Profit Margin, Adjusted
EBITDA and Adjusted EBITDA Margin alongside other financial
performance measures, loss from operations, net loss, and our other
GAAP results.
About Sweetgreen
Sweetgreen (NYSE: SG) is on a mission to build healthier
communities by connecting people to real food. Sweetgreen sources
the best quality ingredients from farmers and suppliers they trust
to cook food from scratch that is both delicious and nourishing.
They plant roots in each community by building a transparent supply
chain, investing in local farmers and growers, and enhancing the
total experience with innovative technology. Since opening its
first 560-square-foot location in 2007, Sweetgreen has scaled to
over 235 locations across the United States, and their vision is to
lead the next generation of restaurants and lifestyle brands built
on quality, community and innovation. To learn more about
Sweetgreen, its menu, and its loyalty program, visit
www.Sweetgreen.com. Follow @Sweetgreen on Instagram, Facebook and
X.
SWEETGREEN, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except share and
per share amounts)
(unaudited)
As of September 29,
2024
As of December 31,
2023
ASSETS
Current assets:
Cash and cash equivalents
$
234,623
$
257,230
Accounts receivable
7,141
3,502
Inventory
2,103
2,069
Prepaid expenses
6,426
5,767
Current portion of lease acquisition
costs
93
93
Other current assets
4,918
7,450
Total current assets
255,304
276,111
Operating lease assets
248,537
243,992
Property and equipment, net
285,279
266,902
Goodwill
35,970
35,970
Intangible assets, net
24,543
27,407
Security deposits
1,408
1,406
Lease acquisition costs, net
357
426
Restricted cash
2,640
125
Other assets
3,943
4,218
Total assets
$
857,981
$
856,557
LIABILITIES, AND STOCKHOLDERS’
EQUITY
Current liabilities:
Current portion of operating lease
liabilities
$
34,673
$
31,426
Accounts payable
18,133
17,380
Accrued expenses
28,080
20,845
Accrued payroll
13,964
13,131
Gift cards and loyalty liability
3,672
2,797
Other current liabilities
—
6,000
Total current liabilities
98,522
91,579
Operating lease liabilities, net of
current portion
279,792
271,439
Contingent consideration liability
13,564
8,350
Other non-current liabilities
756
819
Deferred income tax liabilities
2,043
1,773
Total liabilities
$
394,677
$
373,960
COMMITMENTS AND CONTINGENCIES
Stockholders’ equity:
Common stock, $0.001 par value per share,
2,000,000,000 Class A shares authorized, 103,363,461 and 99,700,052
Class A shares issued and outstanding as of September 29, 2024 and
December 31, 2023, respectively; 300,000,000 Class B shares
authorized, 12,260,027 and 12,939,094 Class B shares issued and
outstanding as of September 29, 2024 and December 31, 2023,
respectively
116
113
Additional paid-in capital
1,309,516
1,267,469
Accumulated deficit
(846,328
)
(784,985
)
Total stockholders’ equity
463,304
482,597
Total liabilities and stockholders’
equity
$
857,981
$
856,557
SWEETGREEN, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except share and
per share amounts)
(unaudited)
Thirteen weeks ended
September 29,
2024
September 24,
2023
Revenue
$
173,431
100
%
$
153,428
100
%
Restaurant operating costs (exclusive of
depreciation and amortization presented separately below):
Food, beverage, and packaging
47,706
28
%
41,754
27
%
Labor and related expenses
47,520
27
%
43,750
29
%
Occupancy and related expenses
15,054
9
%
13,961
9
%
Other restaurant operating costs
28,210
16
%
24,850
16
%
Total restaurant operating costs
138,490
80
%
124,315
81
%
Operating expenses:
General and administrative
36,777
21
%
35,963
23
%
Depreciation and amortization
16,905
10
%
15,682
10
%
Pre-opening costs
1,759
1
%
2,522
2
%
Impairment and closure costs
114
—
%
132
—
%
Loss on disposal of property and
equipment
63
—
%
489
—
%
Restructuring charges
498
—
%
812
1
%
Total operating expenses
56,116
32
%
55,600
36
%
Loss from operations
(21,175
)
(12
)%
(26,487
)
(17
)%
Interest income
(2,754
)
(2
)%
(3,381
)
(2
)%
Interest expense
26
—
%
19
—
%
Other expense (income)
2,279
1
%
1,612
1
%
Net loss before income taxes
(20,726
)
(12
)%
(24,737
)
(16
)%
Income tax expense
90
—
%
318
—
%
Net loss
$
(20,816
)
(12
)%
$
(25,055
)
(16
)%
Earnings per share:
Net loss per share basic and diluted
$
(0.18
)
$
(0.22
)
Weighted average shares used in computing
net loss per share, basic and diluted
114,752,307
112,179,722
SWEETGREEN, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except share and
per share amounts)
(unaudited)
Thirty-nine weeks
ended
September 29,
2024
September 24,
2023
Revenue
$
515,922
100
%
$
431,015
100
%
Restaurant operating costs (exclusive of
depreciation and amortization presented separately below):
Food, beverage, and packaging
141,307
27
%
118,333
27
%
Labor and related expenses
142,954
28
%
126,506
29
%
Occupancy and related expenses
44,523
9
%
40,117
9
%
Other restaurant operating costs
82,141
16
%
68,920
16
%
Total restaurant operating costs
410,925
80
%
353,876
82
%
Operating expenses:
General and administrative
112,844
22
%
111,220
26
%
Depreciation and amortization
50,069
10
%
43,310
10
%
Pre-opening costs
4,295
1
%
8,190
2
%
Impairment and closure costs
388
—
%
479
—
%
Loss on disposal of property and
equipment
178
—
%
547
—
%
Restructuring charges
1,497
—
%
6,448
1
%
Total operating expenses
169,271
33
%
170,194
39
%
Loss from operations
(64,274
)
(12
)%
(93,055
)
(22
)%
Interest income
(8,690
)
(2
)%
(9,694
)
(2
)%
Interest expense
242
—
%
58
—
%
Other expense (income)
5,247
1
%
1,597
—
%
Net loss before income taxes
(61,073
)
(12
)%
(85,016
)
(20
)%
Income tax expense
270
—
%
954
—
%
Net loss
$
(61,343
)
(12
)%
$
(85,970
)
(20
)%
Earnings per share:
Net loss per share basic and diluted
$
(0.54
)
$
(0.77
)
Weighted average shares used in computing
net loss per share, basic and diluted
113,743,453
111,687,538
SWEETGREEN, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Thirty-nine weeks
ended
September 29,
2024
September 24,
2023
Cash flows from operating activities:
Net loss
$
(61,343
)
$
(85,970
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation and amortization
50,069
43,310
Amortization of lease acquisition
69
69
Amortization of loan origination fees
58
36
Amortization of cloud computing
arrangements
682
657
Non-cash operating lease cost
23,312
21,692
Loss on fixed asset disposal
178
547
Stock-based compensation
30,214
40,133
Non-cash impairment and closure costs
73
66
Non-cash restructuring charges
525
5,050
Deferred income tax expense
270
954
Change in fair value of contingent
consideration liability
5,214
1,591
Changes in operating assets and
liabilities:
Accounts receivable
(3,639
)
(6,647
)
Inventory
(34
)
(1,965
)
Prepaid expenses and other assets
1,408
(1,091
)
Operating lease liabilities
(16,854
)
(16,779
)
Accounts payable
(421
)
7,085
Accrued payroll and benefits
833
6,934
Accrued expenses
5,846
2,186
Gift card and loyalty liability
875
(184
)
Other non-current liabilities
(64
)
(118
)
Net cash provided by (used in) operating
activities
37,271
17,556
Cash flows from investing activities:
Purchase of property and equipment
(57,739
)
(74,884
)
Purchase of intangible assets
(5,458
)
(4,461
)
Security and landlord deposits
(2
)
(27
)
Net cash used in investing activities
(63,199
)
(79,372
)
Cash flows from financing activities:
Proceeds from stock option exercise
9,704
5,111
Payment of contingent consideration
(3,868
)
—
Payment associated to shares repurchased
for tax withholding
—
(166
)
Net cash provided by (used in) financing
activities
5,836
4,945
Net decrease in cash and cash equivalents
and restricted cash
(20,092
)
(56,871
)
Cash and cash equivalents and restricted
cash—beginning of year
257,355
331,739
Cash and cash equivalents and restricted
cash—end of period
$
237,263
$
274,868
Supplemental disclosure of cash flow
information
Cash paid for interest
$
184
$
—
Non-cash investing and financing
activities
Purchase of property and equipment accrued
in accounts payable and accrued expenses
$
9,387
$
5,455
Non-cash issuance of common stock
associated with Spyce milestone achievement
$
2,132
$
—
SWEETGREEN INC. AND
SUBSIDIARIES
SUPPLEMENTAL FINANCIAL AND
OTHER DATA
(dollars in thousands)
(unaudited)
Thirteen weeks ended
Thirty-nine weeks
ended
September 29,
2024
September 24,
2023
September 29,
2024
September 24,
2023
SELECTED OPERATING DATA:
Net New Restaurant Openings
5
15
15
34
Average Unit Volume (as adjusted)(1)
$
2,907
$
2,905
$
2,907
$
2,905
Same-Store Sales Change (%) (as
adjusted)(2)
6
%
4
%
7
%
4
%
Total Digital Revenue Percentage
55
%
58
%
56
%
59
%
Owned Digital Revenue Percentage
29
%
37
%
31
%
37
%
(1)
One restaurant was excluded from the
Comparable Restaurant Base for the thirteen and thirty-nine weeks
ended September 29, 2024. Two restaurants were excluded from the
Comparable Restaurant Base for the thirteen and thirty-nine weeks
ended September 24, 2023. Such adjustments did not result in a
material change to AUV.
(2)
Our results for the thirteen and
thirty-nine weeks ended September 29, 2024 have been adjusted to
reflect the temporary closures of two and five restaurants,
respectively, which were excluded from the calculation of
Same-Store Sales Change. Such adjustments did not result in a
material change to Same-Store Sales Change. Our results for the
thirteen and thirty-nine weeks ended September 24, 2023 have been
adjusted to reflect the temporary closures of zero and two
restaurants, respectively, which were excluded from the calculation
of Same-Store Sales Change. Such adjustments did not result in a
material change to Same-Store Sales Change.
SWEETGREEN, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Measures (dollars in
thousands) (unaudited)
The following table sets forth a reconciliation of our loss from
operations to Restaurant-Level Profit, as well as the calculation
of loss from operations margin and Restaurant-Level Profit Margin
for each of the periods indicated:
Thirteen weeks ended
Thirty-nine weeks
ended
September 29,
2024
September 24,
2023
September 29,
2024
September 24,
2023
Loss from operations
$
(21,175
)
$
(26,487
)
$
(64,274
)
$
(93,055
)
Add back:
General and administrative
36,777
35,963
112,844
111,220
Depreciation and amortization
16,905
15,682
50,069
43,310
Pre-opening costs
1,759
2,522
4,295
8,190
Impairment and closure costs
114
132
388
479
Loss on disposal of property and
equipment(1)
63
489
178
547
Restructuring charges(2)
498
812
1,497
6,448
Restaurant-Level Profit
$
34,941
$
29,113
$
104,997
$
77,139
Loss from operations margin
(12
)%
(17
)%
(12
)%
(22
)%
Restaurant-Level Profit Margin
20
%
19
%
20
%
18
%
(1)
Loss on disposal of property and equipment
includes the loss on disposal of assets related to retirements and
replacement or write-off of leasehold improvements or
equipment.
(2)
Restructuring charges are expenses that
are paid in connection with reorganization of our operations. These
costs primarily include lease and related costs associated with our
vacated former Sweetgreen Support Center, including the impairment
and the amortization of the operating lease asset.
The following table sets forth a reconciliation of our net loss
to Adjusted EBITDA, as well as the calculation of net loss margin
and Adjusted EBITDA Margin for each of the periods indicated:
Thirteen weeks ended
Thirty-nine weeks
ended
September 29,
2024
September 24,
2023
September 29,
2024
September 24,
2023
Net loss
$
(20,816
)
$
(25,055
)
$
(61,343
)
$
(85,970
)
Non-GAAP adjustments:
Income tax expense
90
318
270
954
Interest income
(2,754
)
(3,381
)
(8,690
)
(9,694
)
Interest expense
26
19
242
58
Depreciation and amortization
16,905
15,682
50,069
43,310
Stock-based compensation(1)
9,685
11,466
30,214
40,133
Loss on disposal of property and
equipment(2)
63
489
178
547
Impairment and closure costs(3)
114
132
388
479
Other expense/(income)(4)
2,279
1,612
5,247
1,597
Spyce acquisition costs(5)
—
148
—
470
Restructuring charges(6)
498
812
1,497
6,448
ERP implementation and related
costs(7)
229
222
682
657
Legal Settlements(8)
—
15
36
65
Performance stock unit payroll
taxes(9)
491
—
491
—
Adjusted EBITDA
$
6,810
$
2,479
$
19,281
$
(946
)
Net loss margin
(12
)%
(16
)%
(12
)%
(20
)%
Adjusted EBITDA Margin
4
%
2
%
4
%
—
%
(1)
Includes non-cash, stock-based
compensation.
(2)
Loss on disposal of property and equipment
includes the loss on disposal of assets related to retirements and
replacement or write-off of leasehold improvements or
equipment.
(3)
Includes costs related to impairment of
long-lived assets and store closures.
(4)
Other expense includes the change in fair
value of the contingent consideration. See Notes 3 to our condensed
consolidated financial statements included elsewhere in our
Quarterly Report for the third quarter of fiscal year 2024.
(5)
Spyce acquisition costs includes one-time
costs we incurred in order to acquire Spyce including, severance
payments, retention bonuses, and valuation and legal expenses.
(6)
Restructuring charges are expenses that
are paid in connection with reorganization of our operations. These
costs primarily include lease and related non-cash expenses
associated with the vacated former Sweetgreen Support Center,
including the impairment and the amortization of the operating
lease asset.
(7)
Represents the amortization costs
associated to the implementation from our cloud computing
arrangements in relation to our enterprise resource planning
system.
(8)
Expenses recorded for accruals related to
the settlements of legal matters.
(9)
Includes the employer portion of payroll
taxes related to the vesting of 300,000 performance stock units
released to each founder during the thirteen weeks ended September
29, 2024.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107898954/en/
Sweetgreen Contact, Investor Relations: Rebecca Nounou
ir@sweetgreen.com
Sweetgreen Contact, Media: Jenny Seltzer
press@sweetgreen.com
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